Note: Requires Mod Helpers and Time Limit. Made to also make use of Rewards (optional).
For having met my first patreon goal, here's a mod request I've implemented based on this idea. In a nutshell, once the mode is activated, a timer is set for the current world, causing it to auto-exit and become unplayable thereafter. Once a new world is loaded, all players that join it will be reset (all items, max life, max mana, etc. set to starting amounts). The only recourse for preserving player progress between resets is by way of accrued Progress Points (via. Rewards mod).
Source code now available. API now available (now featuring Mod.Call() bindings).
Requires tModLoader (+0.11). Copy the above .tmod file to your 'Documents/My Games/Terraria/ModLoader/Mods' folder to play.